Which term describes a rise in prices that occurs after a period of deflation?

Unlock all questions

This demo includes only 20 questions. Upgrade to access hundreds of questions, flashcards, exam simulations, and disable ads.

Full question bankExam simulationsFlashcards
From $25.99Unlock all

Prepare for the QFA Investments Exam 1. Study with flashcards and multiple-choice questions with detailed explanations. Enhance your understanding and succeed on your exam!

Multiple Choice

Which term describes a rise in prices that occurs after a period of deflation?

Explanation:
Reflation is the move describing a rise in the price level after a period of deflation, typically driven by policy actions that stimulate demand and push inflation back toward a target. After deflation, central banks and governments may ease monetary policy, boost spending, or cut taxes to lift prices and activity. This term is used specifically for reversing deflation; inflation is a general rise in prices, but not necessarily tied to reversing deflation, and deflation is the opposite trend. Regression isn’t a standard term for price movements in this context.

Reflation is the move describing a rise in the price level after a period of deflation, typically driven by policy actions that stimulate demand and push inflation back toward a target. After deflation, central banks and governments may ease monetary policy, boost spending, or cut taxes to lift prices and activity. This term is used specifically for reversing deflation; inflation is a general rise in prices, but not necessarily tied to reversing deflation, and deflation is the opposite trend. Regression isn’t a standard term for price movements in this context.

More Multiple Choice Questions
Subscribe

Get the latest from Passetra

You can unsubscribe at any time. Read our privacy policy